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Trading conditions in gold to remain choppy - analyst
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Australia inflation eases in Q1, likely past the peak
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Palladium on track to snap two sessions of losses
(Adds graphic, updates prices)
By Arundhati Sarkar
April 26 (Reuters) - Gold traded in a narrow range on
Wednesday, with a subdued dollar and recessionary fears lending
some support to the safe-haven asset, while investors sought
more clarity on the Federal Reserve's rate-hike trajectory from
upcoming U.S. economic data.
Spot gold held steady at $1,998.50 per ounce by 0724
GMT, trading in a $9 range, while U.S. gold futures ticked 0.1% higher to $2,007.40 per ounce.
Investors seemed reluctant to offload their gold holdings
amid weak U.S. economic data.
"Trading conditions will remain choppy, and any dips towards
$1,950 could be snapped up," said Matt Simpson, a senior market
analyst at City Index.
Recessionary fears already seem to be providing a floor for
gold prices, and Friday's personal consumption expenditures
report will likely "pack the biggest punch for gold," Simpson
added.
Data on Tuesday showed U.S. consumer confidence dropped to a
nine-month low in April as worries about the future mounted,
further heightening the risk that the economy could fall into
recession this year.
The dollar index inched 0.3% lower, making gold less
expensive for overseas buyers.
Investors will closely watch U.S. quarterly gross domestic
product data scheduled for Thursday, followed by the reading on
the core PCE index on Friday, ahead of the Fed's May 2-3 meet.
Market participants widely expect the Fed to hike interest
rates by 25 basis points.
Although gold is considered a hedge against inflation and
economic uncertainty, higher interest rates dim the non-yielding
asset's appeal.
Australian inflation, meanwhile, eased from 33-year highs in
the first quarter as the cost of living saw the smallest rise in
more than a year, while core inflation dipped below forecasts,
suggesting less pressure for another hike in interest rates.
Elsewhere, spot silver was flat at $25.05 per ounce,
while platinum rose 0.9% to $1,096.21.
Palladium climbed 2.2% to $1,516.28, set to break a
two-day losing streak if gains hold.
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(Reporting by Arundhati Sarkar in Bengaluru; Editing by Sherry
Jacob-Phillips, Varun H K and Christina Fincher)
